Special council UEP meeting today

July 17, 2013

Cape Coral City Council will be updated on the results of the bidding, loan and total projected cost of the Southwest 6&7 utilities expansion project (UEP) during a special meeting Wednesday at 4:30 p.m.

Utilities Extension Manager Paul Clinghan will update the council on the bidding process for the $102 million project, expected to start in September and run until February 2015.

Seven contacts have been issued to the 12 areas designated in the UEP zone. Ten prequalified contractors went after the seven bids that make up the Southwest 6&7 area.

Guymann Construction and Mitchell & Stark won two bids apiece, with Southwest Utility Systems, Ric-man International and Stevens & Layton each winning one.

Guymann will work on areas 6, 8, 11 and 12, while Mitchell & Stark will take areas 1, 2, 9, and 10.

Southwest will work on 7, Ric-man on 3, and Stevens & Layton won the bid for areas 4&5.

The bids in 2013 come to $73.08 million, compared to $68.27 million in 2008, a 7.05 percent difference. However, when you include the subcontractor fee, other direct costs and other items from 2008, the 2013 cost is actually lower than the 2008 costs.

"The bids look good, we're sitting at about a half-million less than in 2008," said Councilmember Rana Erbrick. "That was one of the key components because we were basing everything on the 2008 numbers."

Clinghan will also discuss the Florida Department of Environmental Protection SRF loans. The clean water loans (sewer and irrigation) for $40 million were approved at the Feb. 13 hearing, which was amended to $34 million in anticipation of an October meeting. Of that, the total may be capped at $20 million, with the remaining funds available after a February or March 2014 hearing.

$16 million in drinking water funds was approved at the April 10 meeting, with the signing deadline for both loans set for Sept. 11.

The going rates for clean water and drinking water are 1.98 and 2.12 percent, respectively, until Oct. 1, with a 20-year repayment. The first loan payment is due six months after completion of the project.

"The key is the rates adjust quarterly, so we have to get the loans signed before Oct. 1 because they may go up a bit," Clinghan said. "I don't think you're going to get as low of rates as you're seeing

Financial Services Director Victoria Bateman and Business Manager Michael Ilczyszyn will also update the council on the project cost, which is expected to be $102.7 million, $89 million of which comes from the SRF loans, $10.5 million already spent, and $3.2 million cash funded.

The initial assessment resolution is expected at next week's special meeting. The introduction of the SRF debt ordinance is Aug. 5, the assessment update is Aug. 14.

The final assessment resolution and approvals of the SRF debt ordinance and resolution, as well as the approval for the city manager to sign the SRF loans and contracts, is set for Aug. 21.

The contracts are slated to be awarded in September.

"I believe we're going to move forward. The low rates, coupled with the bidding, this is not a bad time to be doing this project," Erbrick said. "For some people it's never a good time to do anything. Our job is to do what's best for the forward momentum of the city. The stars are aligning and we should take advantage of that."

Clinghan also believes this is a great time.

"As far as the bids, it's a great time. The rates have never been lower and there's competition for these loans," Clinghan said. "Construction costs and rates are only going to get higher."